When you look closely at the statistics it becomes very obvious that the driving force in our local Westside real estate market is a decline in the demand for property.  The changes in lending guidelines and the availability of money has clearly had an impact on the number of people who are looking to purchase at this time compared to years past. As a result of this decreased demand for homes, inventory is rising slightly and prices are gradually declining. From a technical definition based on our current inventory numbers we are in a “Buyer’s Market”.  When inventory exceeds a six month supply of homes that indicates a Buyer’s Market. When inventory is between four and six months that is considered a neutral market. When inventory dips below a four month supply it is a Seller’s Market. For 2008 we have averaged between an eight and ten month supply of homes.

Here are some overall trends in the market as compared to last year. Be sure to study the micro markets you are interested in to see how they are performing . These numbers include the entire Westside of Los Angeles for single family homes.

This year inventory has ranged from 3100 homes to 3750 homes for sale. We are at 3700 right now. Sales per month have ranged between 209 and 329. In Sept 283 properties closed. Inventory has ranged between 8.4 months supply and 10.1 months supply. We are currently at 9.6 months. The pendings as a % of the homes for sale has ranged from 7.9% to 9.8%. Last month was 7.9%

In 2007 the inventory range was between 2650 and 3700 homes for sale.
In 2007 the sales per month ranged between 275 and 492.
In 2007 the months supply of inventory ranged between 4 and 14.8.
In 2007 the pendings as a % of the homes for sale ranged between 7% and 18.4%.

The average median sales price for the first nine months of the year in 2008 is $1,086,000 vs $1,180,000 for the first 9 months of 2007. This is a 8% decline.

If you look at the different price ranges you will see the under $2.5 million dollar market has been impacted much greater than over $2.5 million. The numbers below are the average median sales price for each dollar range.

Under $1mm $709,000 (2008) vs. $762,000 (2007) down 7%
$1mm - $2.5mm $1,359,000 vs. $1460,000 down 7%
$2.5mm - $5mm  $3,267,000 vs. $3,245,000 up .6%
Over $5mm $6,823,000 vs. $6,797,000 up .4%

Again the bottom line is very simple - There are less people buying homes and this is impacting the market however not nearly as much as most people think. Stay tuned for next month’s report to see if any new trends are developing.

SEPTEMBER 2008 Micro Market Report

SEPTEMBER 2008 Micro Market Report - Condominiums

Filed under: Micro Market Updates on November 11th, 2008